This study focuses on the prediction of sustainable entrepreneurship (SE), defined as a behavior that demonstrates a firm’s engagement in environmentally friendly actions. It addresses the following research question: How do aspects of organizational context (company sector, size, ownership structure) and innovativeness influence an SME’s engagement in sustainable entrepreneurship?

We hypothesize that tangible products sector firms have a greater opportunity to engage in SE given the potential for pollution and legal requirements than those in the tangible service and intangible service sectors. Furthermore we propose that larger firms are more likely to adopt SE than smaller firms due to more stable resources available and a larger exposure to the public. Family businesses are expected to engage in SE more often than nonfamily firms due to their focus on nonfinancial objectives, their embeddedness in their local communities, and their willingness to maintain a good image of the family and the firm. Finally we propose that SE may be viewed as a type of innovation and thus likely to covary with adoption of other innovations.